Health insurance is a type of insurance coverage which pays for the medical and surgical expenses, incurred on treatment of the policyholder or his family. The health insurance covers fully or partly, the cost incurred on medical care and treatment of the insured, in return for premiums paid every year, on or before the due date.
You can avail a health insurance policy, directly from the insurer or you can purchase the policy, online. However, you must pay your insurance premium in full on or before the due date. However, if you miss the due date, then the insurance company offers a ‘short period’ for the payment of outstanding premiums known as the ‘grace period’.
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The Grace period on health insurance can be defined as the additional time allotted, to pay the premium, even after the due date. As per rules, insurance companies must offer a grace period of 15 days for premium payment, for the renewal of health insurance plan.
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Some insurers also extend the grace period on health insurance, until 30 days after the due date. Therefore, the grace period helps gain extra time to make the premium payment. This feature is especially useful for people who forget the premium due date.
However, the premium must be paid within the grace period. Once the grace period is over, the insurance company can reject your plea to renew the health insurance policy, even if you are willing to renew the policy.
Listed below are some of the major drawbacks of not paying your insurance premiums on time:
The health insurance company can reject your renewal, for frequent delay. In this case, you would be forced to avail a new health insurance plan. This will result in discontinuation of all the health insurance benefits you currently enjoy. You would have to start the waiting period and pre-existing diseases waiting period, all over again.
You don’t get health insurance benefits during the grace period as you have not made premium payments on time. Therefore, if you make a claim during the grace period, it will not be honoured.
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The riders would be readjusted and you will be considered a new customer. Therefore, any medical condition like a critical illness or an ailment will henceforth be considered as a pre-existing disease and you will have to wait out the waiting period to enjoy the benefits of your health insurance plan.
As already discussed, the waiting period on your health insurance as well as riders would be re-adjusted. This will result in the loss of all the benefits which you were previously enjoying.
The policyholder must remember the due dates and pay all premiums within the due date. In case he forgets to pay the premium, he can still clear the outstanding dues within the grace period. The grace period starts from the time you fail to pay your premium within the due date. This concept can be understood by the following illustration.
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